The small intestinal epithelium is organized into flask-like glands (crypts) that contain intestinal stem cells and finger-like projections (villi) covered by differentiated cells. A constant process of cell division, differentiation and migration is established along a polarized crypt to villus axis. Establishment and maintenance of this vertical axis requires cell:cell crosstalk between the epithelium and the underlying mesenchyme and is critical to proper homeostasis of the intestine. Analysis of a newly established mouse model in which hedgehog (Hh) signals are blocked (Hhip transgenic mice) reveals that establishment of the crypt/villus axis requires this signaling pathway. Hh signals emanate from the epithelium and are received by the mesenchyme. Shh and Ihh participate in this signal;these two signaling proteins have both overlapping and separate roles. Loss of the combined Hh signal permits the formation of ectopic pre-crypt structures on villus tips, thus disrupting the normal organization of the crypt/villus axis. The epithelial phenotype of Hhip mice reflects alterations in cell:cell crosstalk between the epithelial cells and an expanded population of subepithelial myofibroblasts. The proposal tests the following Hypothesis: A combined Ihh and Shh signal from the epithelium is received by subepithelial myofibroblasts and acts indirectly to limit and organize the Wnt responsive epithelial pre-crypt compartment. In Aim 1, the sequence of molecular and morphological events that accompany crypt/villus axis polarization during late intestinal development will be compared in wild type, Shh -/-, Ihh -/- and Hhip mice. In Aim 2, the targets of Hh signaling in the mesenchymal compartment will be identified. Separate and common targets of Shh and Ihh will be sought;the possibility that Hh induces different genes at different concentrations will be tested. Finally, Aim 3 explores how Hh proteins function to organize the crypt/villus axis (i.e., by polarization via a morphogen gradient or by anchoring of the pre-crypt region) and tests specific candidate genes for their role in patterning this axis. The work will provide new insights into cell:cell signaling pathways crucial for intestinal development.